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Introduction
Following a landmark judgment in the Court of Appeal, Standish v Standish set a precedent in financial remedy cases regarding the identification of matrimonial and non-matrimonial assets, and how the latter may become ‘matrimonialised’ during a marriage – thus becoming subject to sharing on divorce (as reported in our previous article here).
The sharing principle, as identified in White v White [2000], holds that “the fruits of the matrimonial partnership” should be shared equally unless there is a good reason to depart from equality.
However, the issue in this case was whether the husband’s non- matrimonial asset, originating from premarital endeavour, became ‘matrimonialised’ upon its transfer to the wife, or whether the source of the asset predated the marriage and is therefore exempt from the sharing principle.
The Court of Appeal decision in May 2024 drastically reduced the original High Court award to Mrs Standish from £45m to a mere £25m. Her understandable unhappiness at this result led to her being subsequently being granted permission to appeal to the UK Supreme Court, and the hearing concluded on 1 May 2025.
Background
Mr and Mrs Standish married in 2005. Prior to the marriage Mr Standish had accrued substantial wealth through his own endeavours, namely a career in investment banking from which he retired in 2007. The High Court confirmed that there had been no material increase in his wealth since his retirement.
In 2017/18 Mr Standish took advice regarding his tax position on the basis of his deemed domiciled status in the UK. The advice he received was to transfer £77million to Mrs Standish, who had non-domiciled status and would therefore not be subject to the same tax implications, enabling her to place the monies into a trust.
Before the trust was established Mrs Standish applied for divorce whilst still holding the £77 million (the 2017 Assets).
Both parties applied to the High Court seeking financial remedy in relation to all of the marital assets with the 2017 Assets becoming the centre of the sharing principle debate. The wife claimed that the marriage was a ‘partnership of equals’ and as such there should be a 50:50 split. However, the wife had also asserted that upon transfer, the assets became hers, claiming a separation of property.
The husband disputed this, claiming he had never intended to share ownership of the 2017 Assets and asserting that even if the court found that the assets had been ‘matrimonialised’ the division should not be equal as they resulted from his pre-marital endeavours.
Justice Moor rejected the wife’s separate property claim and found that by transferring the asset to the wife, the husband had ‘matrimonialised’ the property meaning the sharing principle applied. Moor concluded that as a substantial amount of the wealth had accumulated from past endeavours, it was therefore appropriate for the 2017 Assets to be divided 34% to the wife and 66% to husband.
Court of Appeal decision
Both parties appealed the decision on the following grounds:
- Title factor: the wife asserted the 2017 Assets were separate non-matrimonial property which became hers upon the action of transfer taken by the husband; and
- Source factor: the husband asserted that the source of the wealth should be the deciding factor based on his actions generating the wealth.
The Court of Appeal agreed that there should be no equal sharing of the monies and rejected the wife’s separate property claim affirming it was ‘nonsense’ that she became the source of the wealth as the source was a reflection of generation not title.
Where the Court of Appeal departed from the High Court’s decision was the manner in which Moor J had divided the assets. The rationale for the division was not clear, as Moor J found that the 2017 Assets had been generated pre-marriage yet awarded the wife a generous 36% of the same. The Court of Appeal determined this was an unjust division.
Referring to Jones and Hart (Hart v Hart [2018] 2 WLR 509; Jones v Jones [2012] Fam 1), the Court of Appeal held that a fair allowance should be made to reflect a product of non-marital endeavour where the source had not changed. It was therefore determined that the 2017 Assets should be divided 75% non-marital and 25% marital property which would be added to the pot of assets and divided equally between the parties.
Legal issues for the Supreme Court
Mrs Standish was subsequently granted permission to appeal the Court of Appeal decision, and after hearing the submissions from the parties’ legal representatives on 30 April and 1 May 2025, we now await the eagerly anticipated Supreme Court judgement.
The primary issue to be considered is: When does non-matrimonial property become matrimonial property in the context of financial remedy proceedings, and how should the sharing principle be applied to such property?
As identified by the Justices during the hearing, the effect of this decision will not only affect ‘big money’ divorce cases, but its principles will apply to all divorce cases across England and Wales.
Greater clarity regarding the sharing principle could lead to a more in-depth investigative approach when deciding whether an asset has become ‘matrimonialised’ and if it has, how the court should fairly and justly divide that asset.
For more information please contact Pippa Allsop on pippa.allsopp@michelmores.com or Sarah Green on sarah.green@michelmores.com in the Family team
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